Six Levels of Leadership

by Fabiaan Van Vrekhem

While organizations could previously expand their market position over time, they now have to operate in a context in which changes occur at constantly increasing rates. Tomorrow is different from yesterday. Disruptive business models shake entire sectors to their very foundations. The network economy, in which nearly everything is available to nearly everyone, imposes a new requirement on leaders.¹
This new requirement is at the heart of leadership. It has to do with change, agility, problem-solving ability, the awareness needed to be able to adapt to an increasing complexity. And it has to complement the other qualities that we traditionally look for in leaders: knowledge and experience, interpersonal skills, personality and values.
This ability to deal with complexity has been researched for long by Elliott Jaques². According to Jaques, a person’s ability to handle complexity is based on their level of consciousness. As complexity increases, it poses new challenges for decision-making and thus of the way of making meaning of what is going on around us. This thesis has been supported by Robert Kegan³ who discovered that the way of meaning making is inherently present in every individual, and according to Kegan, evolves throughout our whole life.
On the purpose of leadership: value creation
All leaders – from team leader to CEO – shape an image of their reality. But they don’t look through the same lens. On the whole, we can identify six levels of leadership, six types of leaders who have a different level of consciousness, and as a consequence, will develop strategic plans, initiate actions and create value for their organization from a different (less or more complex) perspective. As we will see, depending on the level of consciousness, a leader will act and respond differently to the challenges that arise.
You will be introduced to six levels of leadership, six levels of consciousness⁴.
Let’s meet the six types of leaders. What type are you?
1. “Solution” leaders
2. “Best practice” leaders
3. “Strategic development” leaders
4. “Transformational” leaders
5. “Global” leaders
6. “Captains of society”
1. “Solution” leaders are aware that people have perceptions and give meaning, based on their knowledge, values and desires. They approach the client not just from their own perception, but realize that perceptions exist on their own, and that they can be used to make a difference by serving client needs. When assigned to a new managerial position, they will look for means to optimally respond to the client demands and their underlying norms and wishes. Their actions will be focused on client satisfaction: offering a solution to the individual client’s need is the main focus. Typical terminology: customer service, quality criteria, solution selling. Solution leaders will principally not anticipate new methods to address market segments differently or more effectively, because they focus on tangible perceptions. They will be most successful in organizations where the leader’s role is to maintain the overview, to manage the process and to strive for optimal results by reaching higher service levels for individual customers.
2. “Best practice” leaders are consciously aware that perceptions are situational and thus can vary depending to the circumstances that are taken into account. By consequence they will look how to optimally fulfill the needs of certain market situations or segments. They will give products or services a recognizable space, that differentiates from competitors. When assigned to a new managerial role, they will look for the weakest links and focus on optimizing these links to improve performance in specific situations. Their actions will be aimed at improving efficiency: reducing costs and increasing revenue. Typical terminology: operational excellence, cost reduction, market penetration. “Best practice” leaders will not anticipate the changing business context, because they focus on what is present and try to make the best out of it. Profit maximization is the most important drive. They will be most successful in organizations where the focus lies on maximizing resources within a given context.
3. “Strategic development” leaders are consciously aware that needs vary according to the way we give meaning to context. Physical and emotional contexts (among other contexts) are two different things and so are the needs, norms and circumstances linked to it. They focus on how contexts will evolve, and on how one can create totally new experiences for their clients, better adapted to certain contexts. When assigned to a new role, they will seek new growth perspectives by looking for new methods, concepts or systems that respond to upcoming changes by looking at other contexts. Their actions are not principally aimed at improving efficiency (reduce costs and increase revenue), but to anticipate trends, develop new products, services or markets and maximize value for the customer. Typical terminology: customer loyalty, differentiation, experience economy. Of course, they do continue to develop “best practices” to optimize efficiency, but they will contribute the most in companies where the existing product/service portfolio has limited growth potential, and leaders have to tap new sources of growth.
4. “Transformational ” leaders are consciously aware that their activity is interconnected with the role they play in the life of their stakeholders. Consciously shaping the role they want to play enables them to reflect about who they want to be for whom, how to best fill this role and to utilize the company’s existing competencies to create new business models and experiences that are even closer to the client’s desired lifestyle. In doing so, new activities become visible from where growth can be realized. They will be most successful in organizations where strategic product/service/market development has become insufficient to realize growth ambitions. Their strategic intent will be aimed at providing the company with a new identity or reputation, or when there is a need to expand the role beyond the existing contexts managed.
5. “Global leaders” are consciously aware that roles are created based on what one considers valuable and thus on the proper values or drives. They are aware that the role they play can be determined by the values to which it contributes. The purpose shifts from fulfilling their own values to fulfilling the values of others or what other consider meaningful. When elected to take up their executive role, they will shape new products, services, systems, concepts, business models and roles with the aim to respond to what will be considered meaningful in the future. Global leaders will be most successful leading corporations, looking out for political, economic, social or technological shifts that might influence what people will consider valuable (and will drive their behaviour) in the years ahead.
6. “Captains of society” are consciously aware that what is valuable to one can only be sustainable as long as it does not have an negative impact on what others consider valuable. Their purpose is to build or contribute to the creation of sustainable ecosystems. When elected to take up their role, they will strive for a balance of the whole and act as a stabilizing or supporting factor so that every individual can live according to his/her own purpose. Their actions are aimed at adapting the business strategy in order to meet societal needs, minimizing environmental impact and improving social development. They will be most successful leading global institutions or in philanthropy where they can contribute to society, for current as well as for future generations.

On the ROI of selecting leaders
Leadership assessments are growing in popularity among businesses worldwide to assist in the search and selection process, succession planning or leadership development. When executed properly, leadership assessments always bring return. The investment is negligible compared to risk of failure or misfit. But is what we traditionally measure still appropriate?
Considering Jaques’ and Kegans findings on the levels of complexity in organizations, and the levels of consciousness of every individual, it’s imperative to align the level of complexity that has to be managed with the level of consciousness required to deliver at that level. This is essential when assigning people to leadership roles, especially in today’s dramatically reconfigured world.
When hiring or promoting a person to a leadership position, building a leadership team to implement a strategy or developing a leadership pipeline, having insight into both the required leadership level as well as the “conscious awareness” of the leader to deliver at that level will avoid costly mistakes.
A leader’s level of consciousness will characterize his or her intellectual comfort zone, defined by the what he/she perceives and thus will take into account when making decisions. The manager’s current level of leadership (1 to 6) will determine the value he or she will be able to create for the company (and thus the return on investment of the selection). It will also indicate the leader’s growth perspectives to take on more senior positions over time, because their level of consciousness will continue to evolve!
Given that the appropriate level of consciousness constitutes an essential part of leadership, but differs from person to person, it’s with good reason that leadership assessments are an indispensable tool to minimize the risk of managerial miss-hires. Complemented with the required knowledge and experience, the personality that fits the role and the values that fit the organization, the right leadership selection will bring out the best out of people.

Footnotes
¹ Van Vrekhem, F. (2015), The Disruptive Competence. The Journey to a sustainable business, from matter to meaning.Compact Publishing. www.thedisruptivecompetence.com
² Jaques, E., Cason, K. (1994), Human Capability: A Study of Individual Potential and Its Application.
³ Kegan, R. (1982). The Evolving Self: Problem and Process in Human Development.
⁴ For more detail, we refer to Van Vrekhem, F. (2015), The Disruptive Competence. The Journey to a sustainable business, from matter to meaning.